The Incompetent Obama – His Economic Policies Will Be Our Undoing

After trying to tax Illinois to governmental solvency and economic dynamism, Pat Quinn, a Democrat who has been governor since 2009, now says “our rendezvous with reality has arrived.” Actually, Illinois is still reality-averse, so Americans may soon learn the importance of the freedom to fail in a system of competitive federalism.

Illinois was more heavily taxed than the five contiguous states (Indiana, Kentucky, Missouri, Iowa, Wisconsin) even before January 2011, when Quinn got a lame-duck legislature (its successor has fewer Democrats) to raise corporate taxes 30 percent (from 7.3 percent to 9.5 percent), giving Illinois one of the highest state corporate taxes and the fourth-highest combination of national and local corporate taxation in the industrialized world. Since 2009, Quinn has spent more than $500 million in corporate welfare to bribe companies not to flee the tax environment he has created.

Quinn raised personal income taxes 67 percent (from 3 percent to 5 percent), adding about $1,040 to the tax burden of a family of four earning $60,000. Illinois’ unemployment rate increased faster than any other state’s in 2011…

…To prepare for Illinois’ probable plunge into insolvency, read “Freedom to Fail: The Keystone of American Federalism” by Paul E. Peterson and Daniel Nadler in the University of Chicago Law Review. They note that only 25 of the world’s 193 nations have federal systems, and in most of the 25 the freedom of the lower tiers of government is more circumscribed by the central government than American state governments are by the federal government. American states’ greater freedom — autonomy under America’s system of dual sovereignty — from the central government’s supervision requires that they be disciplined instead by the market for government bonds, and by the real possibility of default.

…At least 12 percent of Americans change their residences each year, often moving to more hospitable economic environments. In a system of competitive federalism, Peterson and Nadler write, “If states and localities attempt in a serious way to tax the rich and give to the poor, the rich will depart while the poor will be attracted.” And government revenues and expenditures vary inversely.

And if the most incompetent President in our history is re-elected we will see this kind of thing spread throughout the country. Any government that believes they can tax themselves out of a hole WILL face reality soon.

In the 1980s, the world learned (or so we thought) that the way out of the malaise of the 1970s were reforms that encourage private investment and risk-taking, labor mobility and flexibility, an end to price controls, tax rates that encouraged capital formation, and what the World Bank now broadly calls “the ease of doing business.” Amid this crisis, Europe has tried everything except these policies.

If Reagan or Margaret Thatcher are too déclassé for Europeans to invoke, how about Germany? Throughout the 1990s and the first years of the last decade, Germany was Europe’s hobbled giant, with consistently subpar growth rates and unemployment that in 2005 hit 11.3%, nearly at the top of the OECD chart.

Then-Chancellor Gerhard Schröder, a Social Democrat, surprised the world, to say nothing of his own voters, by pushing through the labor-market reforms that paved the way for the current relative prosperity. The changes cut welfare benefits and gave employers more flexibility in reaching agreement with their employees on working time and pay.

The Schröder government, and later the coalition under Angela Merkel, also cut federal corporate income taxes to 15% from 45% in 1998. Include state taxes, and the effective corporate rate today is close to 30%, down from 50% or more in the 1990s. These reforms made Germany more competitive, attracted investment and jobs, and paved the way for the country’s economic resurgence and an unemployment rate currently at 5.7%.

Mrs. Merkel’s government did the world an additional favor in 2009, amid the financial crisis, by rejecting calls from the International Monetary Fund, then British Prime Minister Gordon Brown, President Obama, Treasury Secretary Tim Geithner and the same dominant Keynesian consensus to join the global spending party.

“They’ve already pumped endless amounts of money into the economy,” said German Finance Minister Wolfgang Schäuble in 2010 about U.S. policy. “The results are dismal.”

The results are indeed dismal, and set to get much worse if their policies of over taxation while printing money to continue spending is continued.

But don’t tell that to the left in this country. If someone makes more money than they do then it’s just unfair.

In a supposed discussion of financial ethics with left-wing Harvard professor Michael Sandel on Wednesday’s NBC Today, co-host Ann Curry decried people being able to pay more money to get through airport security faster: “…there’s an inherent unfairness to it….it’s about those with money having an easier life than those who don’t. And there’s something fundamentally unfair about that.”

Sandel was on to hawk his new book, “What Money Can’t Buy,” which Curry touted as, “a hard look at what’s up for grabs in our society and asks, even if we can buy something, should we?” Sandel put different “moral dilemmas” to the morning show hosts, including the airport security line scenario. Curry went on to indict American society: “…not everyone has access to being able to get money, to work for money…. until America becomes fair in terms of how able people are – can be to make money, until the playing field is fair, it is unfair.”

This is how they think. It’s a belief in Marxist ideals that is ruining this great country. If someone works harder, has better ideas, takes more chances, than the other guy and succeeds in making more money then dammit…we need to forcibly confiscate that money to give to those who are less fortunate. To make it fair.

This kind of insanity will continue if Obama is re-elected. It’s just plain nuts to me to even think this man has even a slight chance at re-election with his pandering slogans, his bankrupt policies, as he leads us to a bankrupt nation.

mossomo

Smorgasbord

If Illinois spends themselves into bankruptcy, does that mean there will be a “Going Out Of Business” sale. Will it be put up for sale, and if there are no buyers, will the state just board up and close down like a business would? I don’t have a problem with that.

And if the most incompetent President in our history is re-elected we will see this kind of thing spread throughout the country. Any government that believes they can tax themselves out of a hole WILL face reality soon.

What if the idea isn’t to try to tax the USA out of the hole, but to keep digging it deeper and deeper until we can’t get out? That’s my thinking.

It’s just plain nuts to me to even think this man has even a slight chance at re-election with his pandering slogans, his bankrupt policies, as he leads us to a bankrupt nation.

This is why the king and his court are on a big federal hiring binge and trying to get as many people on welfare as possible. This way he can promise more people more money if they vote for him. He also wants the illegals to be able to vote.